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3d 108
This cause came on to be heard on the transcript of record and was argued by
counsel.
10
Stratmar contends that the district court erred in granting judgment in favor of
Action. Stratmar argues that it is not liable to Action because: (1) no legally
enforceable agreement existed between Stratmar and Action; and (2) even if
such an agreement had existed, Stratmar was not a party to the agreement
because, in negotiating the agreement, Stratmar simply was acting as an agent
on behalf of its principal, Thrifty. Stratmar's contentions are without merit.
11
12
The fact that no final contract had been signed by the parties does not
necessarily mean that an enforceable agreement is non-existent. Under New
York law, "the existence of a contract may be established through conduct of
the parties recognizing the contract." Apex Oil Co. v. Vanguard Oil & Serv.
Co., 760 F.2d 417, 422 (2d Cir.1985); see also 21 N.Y. Jur.2d Contracts 49
(1982). Furthermore, "[i]n determining whether the parties entered into a
contractual agreement ... it is necessary to look ... to the objective
manifestations of the intent of the parties as gathered by their expressed words
and deeds." Brown Bros. Elec. Contractors v. Beam Constr. Corp., 393
N.Y.S.2d 350, 352 (1977).
13
In the present case, the parties' actions demonstrated that there was an
agreement between the parties. The fact that Action provided staffing for the
Thrifty sites is evidence of an agreement. Likewise, the fact that Stratmar sent
checks to Action as payment on the invoices demonstrates that it recognized the
existence of an agreement. Although Stratmar later stopped payment on these
checks, the record indicates that Stratmar stopped payment not because it
believed that it was being billed for work it had not contracted for, but rather,
because Stratmar learned that it would not be reimbursed by Thrifty.
14
Stratmar argues that, even if there was an enforceable agreement, it should not
be liable to Action because Stratmar was not a party to it. Instead, Stratmar
contends that, when it was negotiating the agreement with Action, it was acting
as an agent for its principal, Thrifty. We reject this contention.
15
16
In the present case, Stratmar contends that Action was aware of the agency
relationship between Stratmar and Thrifty even though Stratmar never explicitly
informed Action that it was acting as Thrifty's agent. As support for its
contention, Stratmar notes that Action had conversations with Thrifty prior to
its negotiations with Stratmar, and that Thrifty made the $25,000 deposit
payment to Action.
17
18
Moreover, the record indicates that Action never believed that Stratmar was
acting on anyone's behalf other than its own. The fact that Action believed that
Stratmar would be the party responsible for payment under the proposed
agreement is evidenced by Action's credit check on Stratmar. Finally, the fact
that Thrifty paid the $25,000 deposit does not definitively demonstrate that
Action knew of an agency relationship between Stratmar and Thrifty. The New
York Court of Appeals has held that "[k]nowledge of the real principal is the
test, and this means actual knowledge, not suspicion." Ell Dee Clothing Co. v.
Marsh, 247 N.Y. 392, 397 (1928). "The mere fact that the plaintiff had reason
to suppose that defendants were acting as agents will not relieve them from
liability on this account." Tarolli Lumber, 399 N.Y.S.2d at 740. In the present
case, although Thrifty paid the $25,000 deposit, this does not provide
conclusive evidence that Stratmar was acting as Thrifty's agent.
19
Finally, it has not been demonstrated that any agency relationship ever existed
between Thrifty and Stratmar. Instead, Stratmar's relationship to Thrifty was
more like that of an independent contractor. Unlike an agent, whose acts are
subject to the principal's direction and control, In re Shulman Transp. Enters.,
744 F.2d 293, 295 (2d Cir.1984), an independent contractor is "one who, in
exercising an independent employment, contracts to do certain work according
to his own methods, and without being subject to the control of his employer,
except as to the product or result of his work." Cubby, Inc. v. Compuserve Inc.,
776 F.Supp. 135, 142-43 (S.D.N.Y.1991) (citation and internal quotation marks
omitted).
20
There is no indication from the record that Stratmar was subject to the control
of Thrifty in carrying out its obligations under the Thrifty-Stratmar contract.
The Thrifty-Stratmar contract states that "[Stratmar] shall hire, train and
supervise staff to be placed at the [Thrifty] sites. [Stratmar] shall be responsible
for maintaining an adequate amount of trained staff to meet the operating needs
of [Thrifty] sites during operating hours." Accordingly, because an independent
contractor is liable for its own contracts, Stratmar, as an independent
contractor, is liable for the cost of the services provided by Action.
21